Why are deficits undesirable?
A)They reduce private savings.
B)If deficits accumulate, people consume at the expense of their children.
C)They lead to high inflation.
D)They increase unemployment.

Question

Quizplus · Accepted Answer

Deficits mean the government is spending more than it is earning. If this continues to accumulate, it means future generations will have to pay off this debt, which ultimately reduces their consumption, harming the economy.

Why Are Deficits Undesirable